While an increasing number of Americans face layoffs, benefit cuts and difficulty paying their bills, the last thing that President-Elect Obama and Congress should be doing is devising ways to make taxpayers’ lives even tougher by forcing them to subsidize healthcare for illegal immigrants.

But believe it or not, that is precisely what they are poised to do.

In so doing, they will also raise taxes on Americans earning well under $250,000, the supposed floor that Obama promised during campaign season for any tax increases.

This week, the House voted to expand the State Children’s Health Insurance Program (SCHIP, pronounced “s-chip”), the federal health care system that provides health insurance to lower-income children via funding to the states. Created in 1997, it constituted the greatest government healthcare expansion since Medicaid and Lyndon Johnson’s “Great Society.”

In theory, SCHIP aims to assist children whose families’ incomes are too high to qualify for Medicaid, but too low to afford private insurance. In practice, however, SCHIP covers hundreds of thousands of adults, while excluding many children that it should presumably assist. And in 2007, the Pelosi-Reid Congress attempted to eviscerate even that income criterion, by expanding SCHIP to cover families whose incomes exceeded the federal poverty level some 300%. Accordingly, it was rightfully seen as a first step on the inexorable road to nationalized health care for all Americans.

And now, Obama and Congress are not only preparing to implement that dramatic funding increase, but also to remove current restrictions prohibiting illegal immigrants from exploiting SCHIP to receive benefits. That prohibition originated in 1996 as part of the successful welfare reform effort, and was applied to SCHIP when it was created one year later. For his part, Obama himself sponsored a bill to remove the illegal immigrant prohibition while he was still in the Senate, and supposedly “moderate” Senate Finance Committee Max Baucus (D – Montana) told reporters that he also favors ending the ban.

Accordingly, Obama and the new Congress appear dead-set on forcing already-strapped American taxpayers to fund health benefits for illegal immigrants.

Further, the proposed revisions would remove current requirements that Medicaid applicants provide documentary evidence of citizenship before receiving benefits, and would no longer require state officials to determine whether the applicant is actually who he or she claims to be.

Making matters even worse, this initiative to provide health entitlements to illegal immigrants comes during the same week in which the Washington, D.C.-based Migration Policy Institute reported that such immigrants are choosing to remain in the United States amid the current economic downturn. And why wouldn’t they? With the promise of an Obama Administration and Pelosi-Reid Congress providing free healthcare benefits, it serves their interests to exploit the system even more.

In addition to forcing Americans to provide healthcare to non-Americans, the proposed legislation raises taxes on people earning under $250,000, thereby breaking Obama’s promise not to do so.

Of course, anyone with the sense to come out of the rain knew that it was not a matter of “if,” but rather “when,” Obama would violate that campaign pledge. Regardless, funding for this vast new entitlement program will come from increased taxes on cigarettes, cigars, chewing tobacco and pipe tobacco. In the 2007 proposed SCHIP expansion, those increases amounted to 160% on cigarettes, 700% on rolling tobacco, some 6,000% on cigars and 160% on chewing and pipe tobacco. Obviously, such increases would constitute a regressive tax that hits lower-income Americans particularly hard.

Thus, at a time in which government should be increasingly careful about waste of taxpayers’ dollars, it is instead becoming less so. The SCHIP expansion that President-Elect Obama and Congress are set to impose will increase taxpayer burdens during an economic downturn, increase the likelihood of fraud, waste and abuse of funds and open the spigot for healthcare benefits to illegal immigrants.

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